Home · Business · Sep 17 archive
MUFG Cautious on Thai Baht Despite Electronics Boom
Developing
In Short: MUFG's Lloyd Chan remains cautious on the Thai Baht, citing weak economic factors that outweigh the benefits of the electronics export boom.
MUFG’s Lloyd Chan maintains a cautious stance on the Thai Baht, projecting USD/THB to reach 34.00 by year-end, according to FXStreet.
Chan argues that despite a surge in electronics exports, Thailand’s economic fundamentals are weakening due to deteriorating terms of trade, sluggish GDP growth, and low Bank of Thailand interest rates.
Thailand’s electronics boom, while beneficial, is generating less foreign exchange support than the headline export growth suggests, according to Chan.
Thailand is a net importer of semiconductors, which are crucial for electronics production, leading to a higher electronics import bill.
Rising chip prices and increased imported content have exacerbated the electronics import bill, limiting the net gains from electronics trade and contributing to broader commodity shocks weighing on external balances.
What's still developing
- Nothing material beyond the confirmed record.
Sources
- FXStreetlink